Here's an idea for raising government revenue whose time may have come. Instead of taxing the income of the wealthy, tax investment transactions that don't contribute much, if at all, to economic growth.

The idea is known as a financial transaction tax. It would amount to fractions of a penny on the dollar value of every stock, bond and derivatives trade -- perhaps 5 cents per $100. But estimates of its potential return run as high as $700 billion a year. That would bump up current federal revenues by about 24%.

A proposal for a financial transaction tax introduced by Rep. Keith Ellison, D-Minn., would exempt stock and bond trades of ordinary people who don't make their living from fancy trading -- individuals with income up to $50,000 and couples earning up to $75,000. (Ellison calls his measure the "Robin Hood Tax," which is an unfortunate way of poking the Wall Street tiger with a stick.) The idea is backed by progressive economists such as Columbia's Jeffrey D. Sachs, who calls it "a solid idea that has been resisted by Wall Street for years." A campaign to press for the tax is just getting started.

That's why Washington's solutions to fiscal issues always seem to point more to cutting services for the poor and working class -- food stamps, Head Start, Social Security, etc. etc. -- instead of to tax increases for the wealthy.

Sachs isn't joking when he talks about resistance from the financial industry. In a broadside issued in March, Deutsche Bank called it "counterproductive" (bankspeak for "it will mean less money for us") and claimed it would "hurt the real economy."

Actually, one good thing about the tax is that it would hurt the fake economy. Robert Pollin of the University of Massachusetts, one of the leading experts on the tax, says it's possible the tax would cut the number of stock and bond transactions by 50%. (In that case, the potential take from Ellison's proposal would be about $350 billion a year.)

But paring back financial trading could be a good thing. The volume of financial transactions has exploded over the last 20 years or so as high-speed stock trading and derivatives plays have taken over the market. How much this activity contributes to the "real economy" is debatable, and it's arguable that it detracts from the financial markets' proper role of discovering the right price for financial assets.

"There's no evidence that having more trading leads to better outcomes," says Pollin; in fact, he says, the evidence goes the other way. What does the market gain from stock trading paced in seconds or even fractions of a second? "Does the valuation of a company change every 30 seconds?" No, he says. Such trading is really just about "making a profit from anomalies in pricing," not about helping companies raise capital.

So think of the financial transaction tax as a stone that kills two birds: It raises money, and it takes froth out of the market. Wall Street has escaped paying the bill for the damage it did to the economy in 2008. The U.S. taxpayer bailed out the financial sector to the tune of more than $700 billion; despite that, the big Wall Street trading firms and banks continue to flout the law, continue to overpay their executives and traders, and continue to squeeze mortgage borrowers and small businesses alike. This is a way to start getting repaid.